Category Archives: WATER

CETA Trade Deal, Jumbo Resort Proposal and Water Privatization

September 14, 2012WATERWater and EnergyCommon Sense Canadian

The following is reprinted with permission from Watershed Sentinel.

Ever since the BC Liberal government surprised residents of BC’s Kootenays with its March 20, 2012 approval for the controversial Jumbo Glacier Resort, people have been asking: Why now? After all, the Jumbo Resort proposal has been around since 1989 and has been successfully opposed by local people for more than twenty years.

Then, on May 1, the Liberals introduced Bill 41, which included an amendment to the Local Government Act buried in a miscellaneous list. That amendment allows for the “incorporation of a new mountain resort municipality…whether or not there are residents in the area,” as long as the proponent “has entered into an agreement with the government with respect to developing alpine ski lift operations, year-round recreational facilities and commercial overnight accommodation within the area…” Just days later, on May 16, Bill 41 passed third reading.

Invermere Mayor Gerry Taft recently told East Kootenay News Online Weekly, “Developers who wish to rezone land have to follow a process that includes public hearings and a final decision by officials who are accountable to the residents who elected them. This legislation would empower a [cabinet] minister to give developers a special status that bypasses the democratic process and undermines the ability of local citizens to control development. The ability of the proposed Jumbo Resort, and other potential developments, to bypass the land use process and get their own municipality status without residents is an affront to local communities. This is far beyond a bad idea. The loss of democracy is a slippery slope, even slipperier than some land speculators and receding glaciers.”

Columbia River-Revelstoke MLA Norm Macdonald said in a recent press release, “Despite the fact that the majority of residents in the area do not support the development of a ski resort in the Jumbo Valley, the BC Liberals are determined to push ahead. And they are willing to go to incredible lengths to make that happen.”

So, to the question of “why now?” we can add: Why quickly enable what Michelle Mungall, NDP MLA for Nelson Creston, calls a “ghost-town resort municipality,” whose mayor and council would be appointed by provincial cabinet to “govern no one and be accountable to no one as they [make] land use decisions impacting an entire region”?

Slippery Slopes

One answer to those questions is revealed here for the first time. A director of Glacier Resorts Ltd., the proponent for Jumbo, is directly involved in promoting the controversial Comprehensive Economic and Trade Agreement (CETA), being negotiated in secret between Canada and the EU since May 2009, with the goal of signing it in 2012.

Celso Boscariol, a Glacier Resorts Ltd. director since at least 2008, has, as President of the Italian Chamber of Commerce in Canada-West (ICCC-West), been a primary advocate for CETA since at least 2011. Boscariol, who ran unsuccessfully in New Westminster-Coquitlam-Burnaby in the 1997 federal election, has long been a BC Liberal Party insider.

Boscariol’s advocacy efforts for CETA are in part funded by the European Union through three grants for the ICCC-West’s EU-Canada Partnership project, which not only promotes “the enhanced EU-Canada Economic Partnership,” but (according to its website, http://eu-canada.com) is also “working with local business organizations and involving the provincial CETA negotiators and policy makers.” Along with the EU, the sponsors for the ICCC-West’s EU-Canada Partnership project include the Canadian federal government, the government of British Columbia, the government of Alberta, NCTM – a large Italy-based law firm, the Italian Chamber of Commerce in Brussels, and the PostMedia Network (which owns newspapers across Canada).

CETA (Canada-EU Comprehensive Economic and Trade Agreement)

Calling CETA “a de facto corporate bill of rights,” Paul Moist, national president of the Canadian Union of Public Employees (CUPE), on July 10, 2012, released a legal analysis of leaked CETA negotiating texts and said the trade deal would “trump provincial powers over natural resources and public services” and “override areas of provincial jurisdiction set in the Constitution.” Moreover, CETA would undermine provincial and municipal powers to ensure that local public procurement contracts go to local businesses.

By July, more than 40 municipalities – including Victoria, Burnaby, North Vancouver, Saskatoon, Toronto, Mississauga, Hamilton, Ottawa, and Montreal – have formally asked to be excluded from CETA, especially from its restrictions on public spending and delivery of public services.

Blair Redlin, a Burnaby-based researcher with the Canadian Union of Public Employees, last year told the Georgia Straight (July 7, 2011), “What the Europeans want is just simply an open-tender, free market approach,” noting that CETA would give the EU access to federal, provincial and municipal procurements worth more than $100 billion per year. “What that means,” Redlin said, “is that they want to prohibit local governments from being able to prefer local suppliers and local businesses.”

Redlin also said that CETA could provide an opening for huge European water companies, like French multinationals Suez and Veolia, to push for the privatization of Canada’s public water system.

As a European organization called Corporate Europe Observatory has revealed, by 2009 the EU was asking that 72 countries would have to “liberalize” their public water services and give unlimited market access to European companies in order to trade with the EU. According to the Council of Canadians, after Mexico signed a comprehensive trade deal with the EU, it saw the takeover of electricity and water utilities by EU companies, as well as the doubling of its bilateral trade deficit.

Calling the scope of CETA “mind-boggling,” the Globe & Mail’s Gary Mason wrote (July 15, 2011) that “60 per cent of municipalities in BC have economic-development strategies that include local procurement and hiring. This is why the Union of BC Municipalities passed a motion at its annual meeting last year [2010] opposing CETA – a vote that mostly went unreported by the media.”

CUPE, the Council of Canadians, the CAW, the Canadian Centre for Policy Alternatives, the Trade Justice Network and others have been trying to alert Canadians to the dangers of CETA since at least 2010. Apparently, it was because of this activism that the ICCC-West’s EU-Canada Partnership initiative was launched.

Their website states: “Media coverage of the CETA negotiations in Canada has been mixed with increasingly negative viewpoints appearing in proportion to coverage of recent political and financial crises in some [European] member states and of vociferous lobbying by a few anti-CETA groups. By undertaking a media campaign in partnership with Postmedia Newspaper Network, ICCC will ensure objective coverage.”

On March 7, 2011, Boscariol hosted and moderated a discussion on “EU-Canada Relations: Recent Developments” at the Vancouver Club, with the EU Ambassador Matthias Brinkman, Canada’s Deputy Chief Trade Negotiator Ana G. Renart, and a provincial official. By November 2011, Boscariol was hosting International Trade Minister Ed Fast for a Vancouver speech on CETA at the ICCC-West, with Boscariol telling Fast, “Our members welcome the government’s efforts to strengthen the transatlantic linkages that make our economies stronger.”

Meanwhile, thanks to “bankster” bailouts and other factors, Italy’s economy was starting to spiral into crisis, along with much of the EU, with unemployment levels skyrocketing to record levels.

Junket to France

Then, in February 2012, even before the approval of Jumbo’s Master Plan was announced, a junket of Jumbo backers, led by Kootenay East MLA Bill Bennett, flew to France to discuss possible investment in Jumbo (and another ski resort planned for Valemont) with European companies. The junket members reportedly met with France Neige International – a ski resort association representing dozens of ski resorts in the French Alps; Compagnie des Alpes – a French government-controlled ski resort operator for resorts in France, Italy and Switzerland; and the Caisse des Depots et Consignations (CDC).

The CDC describes itself as “a fully French state-owned financial institution” with $322 billion in assets. It invests in some 400 private equity funds and is a major shareholder in a variety of multinationals, including (according to one of its websites) “the following companies which focus on construction of infrastructure for transport, water and environment: Veolia, Eiffage, Vivendi and France Telecom.” Clearly, the Caisse des Depots et Consignations is one of the most powerful financial institutions in all of Europe.

When the junket returned to BC, Glacier Resorts Ltd. vice-president Grant Costello told the Invermere Valley Echo (Feb. 23), “In a short period of time we were able to build new relationships with a diverse group of French government officials, mayors, entrepreneurs, and corporate executives all of whom are interested in exporting their knowledge and experience to North America through the gateway of the Kootenays.”

Business Forum

Just days later, March 14-16, the GLOBE 2012 businessfest met in Vancouver. Part of the conference included the “EU-Canada Business Forum on the Environment,” which the EU-Canada Partnership website calls its “very first event.”

The description of that event reads: “The business forum brings together Canadian and European SMEs [small and medium enterprises] in the environmental sector to discuss the state of the industry and developments arising from the Comprehensive and Economic Trade Agreement (CETA) currently under negotiation by Canada and the European Union.”

Giving the Welcome Remarks were Celso Boscariol (as President of the ICCC-West), Anna Biolik, Regional Director for Foreign Affairs and International Trade Canada, and Janet Quiring, Director of International Trade at BC Ministry of Jobs, Tourism and Innovation.

The event was co-sponsored by the Government of British Columbia (which has subsequently been hosted by the EU-Canada Partnership project at an event in Milan touting the province’s “opportunities” for investment in areas such as “green energy, conventional and offshore oil/natural gas, coal and coal-bed gas”).

Less than a week later, on March 20, the BC government announced its approval for Jumbo Resort.

Trade Barriers

The busy Celso Boscariol then went to Montreal. From April 13-17, the 2012 World Summit/National Spring Conference of the Canadian Corporate Counsel Association met in Montreal to discuss “how global legal issues will influence domestic cases and vice-versa.”

Celso Boscariol gave a major power-point presentation called “Bilateral Ambition: Canada, the EU and the Comprehensive Economic and Trade Agreement (CETA)” where he spelled out the “current obstacles” to a successful trade agreement and to fully liberalized trade: provincial regulations; public procurement; supply management; market access; intellectual property; monopolies and state enterprises, among others.
While Boscariol was enlightening his fellow corporate lawyers on CETA, the Harper government dispatched 18 cabinet and deputy ministers to hold press conferences across the country on the “benefits” of CETA; it also created a new webpage about the deal.

Then on May 9, ICCC-West announced that it “is organizing an 18-month long programme of business forums, seminars, conferences and convivial events across Canada and in Europe to promote business opportunities for SMEs and the creation of a platform for cooperation in anticipation of CETA’s finalization.”

Just days later, the controversial Bill 41 was passed, creating the opportunity to incorporate mountain resort municipalities with no residents.

All this has been unfolding against the backdrop of the Harper government’s Bill C-38, which gutted the Fisheries Act, repealed and rewrote the Canadian Environmental Assessment Act, and passed most environmental responsibilities to the provinces. The CETA would then, in turn, trump provincial and municipal regulation – leaving the corporate sector fully in charge.

No wonder it’s being called “a corporate bill of rights.”

“Capital Flight”

Oberto Oberti, the President and CEO of Glacier Resorts Ltd., kindly emailed to me the names of Glacier’s board of directors (The list with other details about the Board of Directors can be found HERE). Oberti also emailed “Quick Facts” about Jumbo, including this statement: “Employment Equity Plan has been proposed to ensure preferential treatment of local residents and First Nations members.”

But according to the Calgary Herald (June 14, 2012), CETA would “enable trained professionals and tradespeople to cross borders and work.”

Indeed, Glacier Resorts Ltd. director Celso Boscariol specializes in immigration law at Vancouver law firm Watson Goepel Maledy LLP.

Oberto Oberti also emailed a document that shows how relatively small in size Jumbo would be by comparison to other BC ski resorts like Panorama, Sun Peaks, Whistler, and a second document containing a 2007 published statement by Glacier’s Grant Costello: “At build-out, in 20-30 years, the [Jumbo] resort will have only a handful of permanent residents just like Panorama has now after 40 years.”

It’s hard to interpret the word “handful” here, but it’s a very curious statement, given that Jumbo’s government-approved water supply from groundwater sources amounts to an “ultimate extraction rate” of 20 litres per second. That works out to 1,728,000 litres per day.

Assuming a generous 250 litres per person per day, by my calculations 1,728,000 litres is sufficient to provide the daily needs – drinking, bathing, laundry, cooking, washing the limousine – of some 7,000 permanent residents. But if there are to be only “a handful of permanent residents” at Jumbo, and 3,000 daily visitors, why would Glacier Resorts Ltd. need the approved 20 litres per second of water?

The answer may lie with the CETA trade deal, and with that “mountain resort municipality” status that Jumbo, and other BC ski resorts being planned, can obtain.

According to the New York Times (June 10, 2012), the EU is currently experiencing “capital flight,” with money leaving the region. “From Italy, Greece, Spain and other countries in the European currency union, the affluent these days are moving money into hard assets valued in something other than euros, which have been plunging in value.” What better “asset” than water?

Having an incorporated municipality with no residents, the proponent and its investors, under CETA, could do just about anything they want with the groundwater – privatize it, form a private utility, sell the water by pipeline across the border. What’s to stop them? And if somehow they were stopped, under CETA they could sue: not just for compensation, but (potentially) for compensation for lost future profits.

Stopping CETA & Jumbo

Oberto Oberti told the Times Colonist (March 21), “My hope is we will see the opening day for Christmas 2014.”

Business In Vancouver (April 10, 2012) reported that Grant Costello “doesn’t expect any brush to be cleared to make way for the project until mid-2013 at the earliest. He said the company’s environmental certificate [which expires in 2014] has 195 conditions, some of which are preconstruction requirements.”

Opponents to Jumbo – including the Ktunaxa First Nation, local conservation group Wildsight, and many others – have clearly drawn a line in the snow on this project. If they were to team up with CETA opponents, they would be even more formidable.

NDP MLA Norm Macdonald told The Tyee (March 21) that if the NDP wins the election scheduled for May 2013, it would be possible to reverse the decision on Jumbo.

One of the reasons the Harper government is pushing for CETA to be signed in 2012 is that it fears the results of provincial elections in BC and Quebec. As Sean Smith, a community-based organizer with the CAW, has written (CCPA Monitor, Sept. 2010), “…before CETA can be officially signed and sealed, it requires the approval of every provincial government. So it is particularly vulnerable to public pressure – just one Premier can derail it.”

Similarly in Europe, 27 member-nations of the EU would have to approve CETA. Currently, the leaked chapter on intellectual property is causing controversy because of potential threats to internet use, privacy, free speech and other issues.

The same CETA chapter proposes to raise pharmaceutical drug costs in Canada by $3 billion per year, which reportedly bothers some Canadian premiers.

Sean Smith puts it well: “Canadians need to learn that the CETA talks have nothing to do with giving Canadians a good alternative to American markets and forging closer ties with happy Swedes and Danes and other progressive Europeans. That mythical EU is disappearing faster than a Greek pension and is being replaced by a corporatist continent that thrives on things like Bulgaria’s minimum pay of 97 Canadian cents an hour. (No, that’s not a typo.) It’s up to us to break through the veil of secrecy and fantasy that has been thrown over these trade talks, expose the deceptive spin, and tell Canadians what CETA is really about.”

CETA and Jumbo Glacier Resort could expire together. The next few months will be crucial.

Other Responses to CETA

“One of the aspects of CETA most worrying for local leaders is the deal’s potential to undermine public control over water and other key municipal services. The leaked initial offer showed that the EU companies want access to contracts in Canadian local government services, going so far as to name specific local utilities, public transit agencies, and other public services in dozens of municipalities across the country… It’s interesting to note that many EU municipalities have taken their own water back under public control after problems with privatized water systems (often privatized under the same EU firms that are trying to get into the Canadian market).”

— Rob Duffy, Director of the Columbia Institute, CCPA Monitor, June 2012

“The Harper government sees CETA as a way to further deregulate and privatize the Canadian economy while increasing corporate power and undermining our democratic options for the future. The EU trade deal could: unfairly restrict how local governments spend money and [could] ban ‘buy local’ policies; add up to $3 billion to the price of drugs; increase Canada’s trade deficit with Europe, leading to significant job losses; empower European corporations to attack environmental and health measures; undermine protections for health care and culture in past trade deals; create pressure to increase privatization of local water systems, transit and energy; strip farmers of their rights to save seed.”

— The Council of Canadians

“With most of our private sector already owned by US corporations, the planned privatization and sale of much of our public sector to European business firms will complete our country’s transformation into a foreign-controlled vassal-state.”
— Sean Smith, CAW activist now with Trade Justice Network, CCPA Monitor, September 2010

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Joyce Nelson is an award-winning freelance writer/researcher and the author of five books.

BC NDP Must Come Clean on its Full Energy Policy

September 9, 2012Energy and Resources, Hydropower, Oil&Gas, Pipelines and Supertankers, WATER, Water and HydrocarbonsBC Oil Pipelines and Supertankers, Enbridge, KinderMorgan, LNG, Oil and gas, Site C Dam, Water and EnergyRafe Mair

The NDP are getting a free ride – at least they certainly are on the energy file.

I must ask again: Why are they not condemning the proposed twinning of Kinder Morgan’s Trans Mountain Pipeline from the Alberta Tar Sands to Vancouver? All the arguments that prevail against the Enbridge line apply to Kinder Morgan, so to say that you’re waiting for the Kinder Morgan applicationto be filed is a flimsy excuse which waters down their general position on energy.

Speaking of a program, just what is the NDP energy policy? We’d better find out soon or it will be too late.

Some questions.

The NDP is wholly supportive of multiple liquified natural gas (LNG) plants in Kitimat, so far as can be told without any real consultation with the public on either the plant itself or the pipeline that would cross the same mountains and forests that Enbridge does.

My feeling is that the NDP don’t want to appear to be against everything. Yet the party was much opposed to an LNG plant on Texada Island a few years ago, mainly on dangers it posed. There are not too many examples of plant failure in the past but when they do have one, the destruction of property and human life is extensive.

I don’t say that this project ought to be banned – I just ask when the public process took place. When was the public, including First Nations, consulted on both the need for such a plant and, if passed, what were the technical and environmental concerns, and, again, where was the public process?

John Horgan, the NDP Energy Critic, seems to favour, without reservations, the obtaining of natural gas through the process now called “fracking”, which is a technique whereby natural gas, trapped in shale beds within the earth’s crust is “mined” by forcing it out by the use of huge quantities of water and chemicals. British Columbia has lots of this natural gas and there’s a sort of “gold rush” mentality amongst those who want to get into the act.

There are huge environmental questions, not least of which is the chemical-laden water getting into the domestic water supply and ecosystems. Moreover, where is the water being taken from?

There are also very real worries for the security of the land under which the “fracking” takes place, namely earthquakes being caused by the controversial practice.

The concerns here are not just picky little matters brought up by traditional boo birds but very real worries.

There is a very big economic question involved: BC and Alberta are not the only places in the world where there are lots of potential fracking areas.

With a huge overabundance of natural gas available, can BC compete? Where are the markets? China, which itself has huge trapped natural gas resources?

Normally one might say, that’s the concern of the companies, not us.

But we know that’s not necessarily so, for corporations discount a good part of the downsides by expecting government bailouts if big trouble comes, for the same reason the US government bailed out the stockbrokers – the cost of not bailing out sinking corporate ships was higher than the subsidies. Moreover, the public is a shareholder in this resource and is receiving reduced dividends from it at these historically low market prices.

There is a further question that has been raised but not dealt with, either by the government or the opposition – why are we devoting energy from water resources, that belong to the public to create energy which then will be used by corporations to make new energy?

The nature of BC Hydro, since W.A.C. Bennett’s days, was to create cheap power for both the public and industry but not to be a partner in the industry, thus liable to losses concerned.

The proposed Site “C” Dam is not needed for domestic energy supply – as our resident economist Erik Andersen has amply demonstrated – but day by day looks more like a scheme to subsidize the untested abilities of fracking companies to do so without environmental damage, in questionable markets. And if not for fracking, then to subsidize comparably questionable new mining operations in northern BC – in any event, the power from Site “C” is patently not for the public that would be paying some $10 Billion to build it.

These are some of many questions being raised by everyone accept the Liberals, who are joined at the hip to industry, and the NDP who are not.

It’s bad enough to have a government of a gaggle of nincompoops, but without an Opposition to ask serious and penetrating questions because they fear the voters won’t like it is a potential tragedy which may well lead to an environmental and fiscal mess not only caused by an incompetent government but an incompetent Opposition as well.

Premier Clark should step aside

August 26, 2012Canada, Politics, Water and Hydrocarbons, Western CanadaChristy Clark, PoliticsRafe Mair

It has been accurately observed that in politics six weeks is an eternity. By April/May of 2013, who knows what the issues of the moment might be? I’ll tell you my bet in a moment.

It is this question which should spur the Liberals into doing something about their leadership – or lack of it.

I simply cannot see how, short of a fluke, Christy Clark can lead her party to victory in May 2013.

Ms. Clark didn’t have a chance from the start. With but one MLA supporting here she had to pull off a miracle in order to start putting Humpty Dumpty together again. Ms Clark doesn’t have it within her to lead in a forceful way – the sad fact is that she simply is not a leader, period.

For the good of her party the premier should step aside. If the Liberals held a leadership convention, soon, the new leader could hardly do worse. Let’s leave that for a moment.

The issues next May are likely to be energy and the environment. The Northern Gateway proposition has become huge; the state of BC Hydro being forced to pay hugely inflated prices to private power companies is catching on; the issues around Natural gas, LNG and “fracking” will be much more focused.

The NDP has had a free run with these issues and, in my opinion have not done a good job in stating a firm policy.

The energy critic John Horgan has, amazingly enough, supported the LNG plant and pipeline through very sensitive territory to it.
He has refused to condemn the increase capacity for Kinder-Morgan on the flimsy excuse that they have not filed their request yet, an amazing stance when you think that they will be pumping bitumen through sensitive areas which is what Enbridge proposes to do and the know all they’ll ever need to know about spills of bitumen. His policy on so-called run of rivers has been wishy washy.

Premier Clark has been pathetic on these subjects and this is the very reason the Libs should dump her.

Would Ms Clark leaving and a new leader chosen lead the Liberals back to power next May?

I very much doubt it – they would, however, at least have a chance whereas they don’t have any chance the way things presently look.

The leadership contest would have to have two results – a leader who had the backing of his MLAs and a clear energy and environmental program that could get public support. If the convention doesn’t give the party “bounce” in the polls, and more importantly, bounce with the voters, it will fail. Yet, as I have been saying, they’re dead in the water as it is and a change is their only chance.

Who could provide a leadership that British Columbians might follow?

I haven’t the faintest idea. The strong man in the caucus is Kevin Falcon but he scarcely could be seen as a man of the environment.

In any event, that’s not my problem.

It gets down to this – whether change would help is uncertain; without change it is all but certain that not only will they lose the election, they might lose their party in the bargain.

Advocates seek action on hydro projects

August 24, 2012WATERprivate river power, Vancouver Sun, Water and EnergyCommon Sense Canadian

Read this article by Larry Pynn in the Vancouver Sun. Excerpt: “Environmental charity Ecojustice went to B.C. Supreme Court to seek a judicial review of the province’s failure to conduct a formal environmental assessment on the Holmes hydro power project near McBride.

“The legal action, taken on behalf of the David Suzuki Foundation and Watershed Watch Salmon Society, argues that 10 linked hydro plants will together generate 85 megawatts of electricity.

“But because no individual plant would generate more than 50 megawatts – the threshold for triggering an environmental assessment – none were ordered.” (August 23, 2012)

LNG, Fracking and Site C Dam: BC’s Looming Energy Boondoggle

August 23, 2012Canada, Energy and Resources, Fracking, Hydropower, Oil&Gas, Politics, Water and Hydrocarbons, Western Canadafracking, LNG, Oil and gas, Politics, Site C DamDamien Gillis

The proposed Enbridge and Kinder Morgan bitumen pipelines through BC are finally receiving the attention they deserve – as is the much-needed corollary conversation on the Alberta Tar Sands and their true impact on Canada’s economic future, elevated to national prominence by Official Opposition leader Thomas Mulcair. Yet, as big of a game-changer as oil pipelines and tankers would be for BC, one could argue that the collection of proposed natural gas-related developments on the table is, taken together, at least as transformative for the province’s future – though you wouldn’t know it from the relative silence on the topic.

Until recently, that is. The past several months have seen a number of highly significant events related to this matter.

First, in mid-June, Apache Canada announced a massive new shale gas find in the Liard Basin, which stretches from northeast BC into the southeast corner of the Yukon. The Liard play, being touted as the “best shale gas reservoir in North America”, is west of the Horn River basin play, already one of the world’s largest. The find is undoubtedly a game-changer, elevating northeast BC to the world’s mecca for the relatively new, yet highly controversial process for breaking open shale gas formations deep underground, known as “fracking”.

The next big development came the day after Apache’s announcement, when the NDP, led by Energy Critic and likely future Energy Minister John Horgan, came out fully supporting an expanded natural gas industry in Northeast BC, downplaying environmental concerns about fracking. In the same breath, the Official Opposition showed clear support for the Liberal plan to build a number of Liquid Natural Gas (LNG) plants in Kitimat to export the resource to Asia.

The party’s position was solidified last week when the Georgia Straight reported it was fully backing a new pipeline from Summit Lake, north of Prince George – Encana, EOG and Apache Canada’s joint venture Pacific Trails Pipeline – to carry natural gas from northeast BC to three proposed LNG refineries in Kitimat.

Finally, Premier Christy Clark announced a week later that her government will be reclassifying previously dirty natural gas as “clean” – but only when it’s burned to power these proposed LNG plants in Kitimat. The Campbell/Clark Government previously banned the development of new gas-fired electrical plants, putting the emphasis on renewable or so-called “clean” energy alternatives – wind, solar, geothermal, biomass and hydro.

The premise for these new multi-billion dollar LNG plants is to access new markets in Asia which currently pay far more for gas than North American customers. Prices in China, Japan and Korea range up to $17 per thousand cubic feet versus a historic low of two to three dollars in North America today – largely thanks to the glut of natural gas flooding the domestic market as a result of new shale gas plays. The idea is to turn some of BC’s plentiful gas supply into liquid, put it on tankers and ship it to Asia to reap big profits. Without these prices, big finds like Apache’s in the Liard Basin simply don’t make sense to develop.

While the plan looks financially (though certainly not environmentally) promising on the surface, it’s fraught with complications:

1. The process of converting gas to liquid is enormously energy intensive. According to Christy Clark, all the the power from BC Hydro’s proposed new 1,100 Megawatt Site C Dam on the Peace River would be required for just Shell’s one proposed LNG plant in Kitimat. That may have changed, now that these plants are allowed to burn their own cheap gas for power, but, curiously, Site C Dam has not been taken off the table in the wake of that announcement. The otherwise energy self-sufficient BC has nowhere near enough electrical supply to power three new LNG plants and all the new mines the Clark Government is pushing forward.

2. The whole plan is contingent on this high price differential carrying forward – which is doubtful for a number of reasons. China’s economy is already showing signs of slowing down, while Japan is looking to restart its nuclear program; where will its energy demand be in 10 years when these plants are built and supplying the Asian market with LNG?

3. We’re not the only horse in the race. China has its own shale gas plays – which it is now starting to develop. Moreover, a number of other countries are thinking the same way we are – chief among them Australia, which is much further along and has already secured contracts to sell LNG to China.

4. The main method of supplying these plants – gas from fracking operations – is coming under increased scrutiny globally, with various moratoria having been instituted in other regions, relating to concerns over water use and contamination, earthquakes, and myriad human and animal health concerns. Fracking producers may well (and should) face increased regulation – meaning added costs and further reduced profits – or, worse, outright restrictions and shutting down of operations as awareness and evidence build against this controversial technique.

LNG and Mines Mean Site C

As befuddled and full of flip-flopery as the Liberals have been on this file, the NDP are in quite a pickle too. First, they give their environmental seal of approval to shale gas, while supporting the massively risky undertaking that is building and fueling multi-billion dollar plants on BC’s coast to turn this gas into liquid and ship it to new markets in Asia. But when the Liberals reclassify gas as “clean” (remember, the NDP just did as much themselves not a week previous) in order to allow these plants to use their own gas to power the enormously energy-intensive liquid compression process, the Opposition cries foul. Why? Because burning gas isn’t clean. So which is it, Mr. Dix?

I filmed a rally in Victoria two years ago led by First Nations and farmers from the Peace Valley in opposition to Site C Dam. NDP Energy Critic John Horgan, to his credit, attended the rally and spoke – but he stopped short of outright opposing the dam. He would only say that it required a full environmental assessment and that it should only proceed if the science supports it.

Then, in January, 2011, Horgan told the Georgia Straight that he didn’t think Site C was “necessary” at the time – though still leaving the door open to the project:

They want some peace in the valley, and as long as the spectre of Site C hangs over their head, there’s never going to be a comfort level in the community,” Horgan said. “They want a full-fledged, full-on environmental assessment, so that they can put on the table the science of the sloughing, the costs of dredging, and the total costs on ratepayers of a $6- to $7- to $8- or even $9-billion project.

Earlier this year, my colleague at the Common Sense Canadian, Rafe Mair put NDP leader Adrian Dix on the spot regarding Site C and got more of the same fence-sitting.

To my understanding, the NDP is on the fence or publicly committed to the above schemes – Site C, fracking, LNG – for three main reasons:

1. It is conscious of not allowing itself to be branded by its political opponents as “anti-progress” or “anti-industry”, especially after having taken a strong position against the Enbridge pipeline

2. It is wary of not stepping on the toes of First Nations who have signed onto to the LNG scheme – particularly the Haisla Nation of Kitimat, who have also been vocal opponents of the Enbridge pipeline.

3. It recognizes how much the province’s coffers have come to depend on royalties, licenses and other fees related to the natural gas industry and doesn’t want to disturb that flow, leading to big deficits that will play into its opponents’ hands.

While these are all politically understandable reasons for supporting this massive industrialization of northern BC, they do not excuse the arguments against this program.

In the very least, the environmental and health concerns associated with fracking and the loss of vital farmland and fish and wildlife habitat from Site C – not to mention the notion of massive public subsidies for an industry on less than solid ground going forward – should argue for a more mature position from the province’s government-in-waiting. They know this whole scheme is fraught with complications and this outright endorsement of it shows the NDP is ready to put short-term politics ahead of reasoned, long-term policy for the province.

Subsidizing Energy for Industry

Clearly, Site C, mining, fracking, LNG are all interrelated. Even if Site C isn’t used to power LNG, there are over a dozen proposed new mines in northern BC – each of which is hungry for taxpayer-subsidized electricity. This begs the question – one answered by economist Erik Andersen in a recent interview with Rafe Mair: should the public be subsidizing new industry at all, with skyrocketing power bills and new $10-plus billion dam projects like Site C?

One of the key bones of contention at this year’s failed Rio climate conference was the matter of ending subsidies for hydrocarbon production. Plainly, this is a no-brainer, if we are to get on with the necessary transition away from fossil fuels to more sustainable energy sources. Moreover, the wealthiest corporations in history are the last entities that should be receiving public subsidies. And yet, we learned through a leaked memo that the Harper Government was leading the charge against the move to end hydrocarbon subsidies. So much for the “free market” Stephen Harper and his fellow Milton Friedman disciples keep railing on about!

So in that regard, it makes abundant sense for the natural gas industry to use some of its own product to supply the enormous energy needs of these LNG plants. And yet, anyone should be able to recognize the environmental folly of reclassifying gas as “clean” to enable its burning, to ship more gas half way around the world to be…burned. And that’s ignoring the myriad environmental problems associated with the initial extraction of the gas through fracking.

A Looming Boondoggle

No matter the degree to which Site C or our public hydroelectric system are used to power this LNG program, the taxpayers of BC, as shareholders in our gas resource, are impacted by the choices the industry makes on numerous levels. We need to ask whether this LNG-Asian market vision is an economically viable, environmentally responsible idea, or an epic resource boondoggle in the making, as we have seen in the past with similar forays into the Asia market with our coal and timber.

These political parties and the industry are banking on achieving a higher price for their gas in Asian markets – particularly China and Japan. But China has its own shale gas potential and is only just beginning to develop it. On top of that, China’s economy – and thus energy demand – is showing real signs of faltering. It will take us 5-10 years to build all these LNG plants and the additional energy assets to power them. Will China still be paying premium prices for LNG a decade from now, given the volatility of the various factors which enable that pricing today?

There are other players, such as Korea and Southeast Asia who might. Petronas Energy of Malaysia recently scooped up Candian gas company Progress Energy for over $5 Billion.

But this raises another question: how will this benefit the BC and Canadian economy – especially in light of new labour laws from the Harper Government that allow companies like Petronas to import foreign workers and pay them 15% less than Canadian employees. So under this system, we could see many jobs going to foreigners (excepting those that are too technical to be done by cheap, imported workers), while these new profits flow out of Canada, along with the energy resource.

This LNG scheme – as with plans to export Alberta bitumen to Asia – should be viewed as a hail mary pass to try and get the Canadian oil and gas industry out of the financial pit into which it is presently sinking. With prices where they are, there is a real danger that BC’s once-thriving industry could collapse, without a North American market willing to pay a reasonable price for its product. And yet, Site C, LNG and fracking, taken together – as they should be – constitute a massive gamble for the citizens of Birtish Columbia, both environmentally and economically. As such it’s time we have a frank conversation about the issue before rushing headlong into a potential boondoggle of unprecedented proportions for our province.

Perhaps what needs to happen here – from both an environmental and economic perspective – is a planned ramping down of the North American natural gas supply, until prices begin to stabilize again. As energy economists like Jeff Rubin argue, the most effective way to regulate energy consumption is through price. Clearly, at $2-3/unit of energy, there is no incentive for the North American public or industry to conserve natural gas. Nor does this price point benefit the gas industry or the public, who are partners in the resource through the royalties and tax dollars we receive from its sale – all of which are significantly diminished in this climate. And yet, reducing supply in the North American market would be a tremendous undertaking that requires a level of collusion – and may not be practical, regardless, with hundreds of companies looking out for their own short-term interests.

In any event, while the public reaction and much-needed discussion around these issues have been delayed, there are signs they are now developing quickly. The political discussion surrounding the issue is intensifying, as is the media’s coverage of it. Already, the bubble shows signs of bursting, as Kitimat LNG – the joint venture between Encana, EOG and Apache – was recently delayed by another year as the consortium has yet to sign the contracts it needs with Asian buyers to finance the project. Meanwhile, some First Nations and environmentalists are beginning to organize protests against the consortium’s Pacific Trails Pipeline – the primary connector between fracked gas of northeast BC and this and other proposed LNG plants on the coast. Opposition to Site C Dam has been steadily growing as well, as I documented at this year’s record-setting ‘Paddle for the Peace’.

It’s high time this issue generated some of the intensity that the Enbridge project has received – as it would likely have as big, if not an even greater cumulative impact on the future of this province, environmentally and socioeconomically.

New N.W.T. oil prospect raising economic hopes and environmental concerns

August 20, 2012Energy and Resources, Oil&Gas, Water and HydrocarbonsOil and gasCommon Sense Canadian

Read this article by Lauren Krugel in the Calgary Herald about a dozen significant oil and gas leases in the central Mackenzie area. (August 12, 2012) “(Chief Wilfred) McNeely said some residents are concerned about how much water would be drawn from the Mackenzie River for the fracking process, in which producers inject water, sand and chemicals into the rock at high pressure in order free the oil and gas. He said some have also expressed concern over chemicals contaminating the river.”

NDP Supports Fracking Pipeline to Kitimat

August 16, 2012Canada, Energy and Resources, Fracking, Oil&Gas, Politics, Water and Hydrocarbons, Western Canadafracking, Oil and gas, PoliticsCommon Sense Canadian

Read this story from The Georgia Straight on the BC NDP’s support for a new pipeline designed to take natural gas from controversial hydraulic fracturing operations in Northeast BC to Kitimat on the province’s coast to be converted to Liquefied Natural Gas and shipped to Asian markets. (Aug. 15, 2012)

The B.C. NDP is opposing the proposed Enbridge oil pipeline, but it supports a pipeline that will transport gas produced through fracking.

For Michael Jessen, the Green Party of B.C.’s energy critic, that’s a clear double standard.

“The NDP is trying to have its cake and eat it too,” the Nelson-based Jessen told the Straight in a phone interview. According to him, New Democrats are wrong to back the planned 463-kilometre Pacific Trail Pipelines project that will run a pipe from Summit Lake, 55 kilometres north of Prince George, to a liquefied-natural-gas plant in Kitimat. The project is a joint venture of Apache Canada Ltd., EOG Resources Canada Inc., and Encana Corporation.

Kitimat is also the western end of Enbridge’s 1,170-kilometre pipeline that would move bitumen from Alberta’s tar sands.

Jessen said that the B.C. NDP’s position on the two projects that involve exports to Asia, in particular China, is contradictory. “Every credible scientist in the world says that we are in very grave danger of passing a tipping point when the planet may reach temperatures that cause considerable havoc,” he said. “And the solution that many of these scientists say we need to follow is to decrease our dependence on fossil fuels.”

Fracking is the practice of pumping fresh water and toxic chemicals deep into the ground to fracture shale bedrock in order to release natural gas.

“It’s been proven that when fracking occurs, there is a considerable amount of methane that is released into the atmosphere,” Jessen explained. “Methane is a far more immediate threat in terms of greenhouse gas when it is released.”

John Horgan is the B.C. NDP critic for energy, mines, and petroleum resources. “In terms of the notion that there’s a contradiction in NDP policy, I don’t think there is,” the Juan de Fuca MLA told the Straight in a phone interview.

Although the extraction and use of both oil and gas affect the environment, Horgan stressed that the impacts of gas are “not as devastating”.

“One of the arguments being made is that they’re both the same, and they’re not,” he said about the two fossil fuels.

The two-term MLA noted that his party supports the expansion of the natural-gas industry in B.C. “provided that appropriate regulatory regimes were in place”. The two-term MLA added that if the B.C. NDP forms the government next year, it will strike an expert panel to review fracking.

“We think that the industry is mature here, as opposed to other places where they’ve had concerns,” Horgan said.

China: The World’s Next Fracking Frontier?

August 16, 2012Energy and Resources, Fracking, Oil&Gas, Water and Hydrocarbonsfracking, Oil and gasCommon Sense Canadian

Read this story and check out this audio clip from PRI’s The World exploring new shale gas finds in China and the future of controversial hydraulic fracturing there. (Aug. 15, 2012

On Shanghai’s Huangpu River, a barge hauls coal upstream to one of the power plants that keeps this city booming. China is the world’s biggest energy guzzler, and it gets three-quarters of its power from coal.

But coal is one of the dirtiest fuels around. It’s the main reason so many of China’s cities are choked with smog, and why China is now the world’s biggest greenhouse gas polluter.

China energy analyst Bill Dodson says it’s “one of the disappointments in China’s rapid development… that it chose to use technologies that are about 200-years-old.”

But these days China is scrambling to find newer and cleaner technologies. And it thinks it’s found a promising one in hydraulic fracturing, or fracking.

Fracking is a relatively new way of getting at cleaner-burning natural gas. It uses pressurized water and chemicals to fracture soft shale rock deep underground and pump out natural gas trapped inside. The technology is revolutionizing energy markets and helping gas take a big bite out of coal use in the US.

“We’d like to repeat the same successful story in China,” says Yang Fuqiang, with the Natural Resources Defense Council (NRDC) in Beijing,

Yang says China is already making big strides in pollution-free power sources like wind and solar, but they’re still likely to provide only 15 percent of China’s energy by 2020.

“That is not enough’” Yang says. “So I think another way is to develop more natural gas and shale gas.”

China has huge untapped shale gas deposits, and supporters hope they can be a bridge between coal and broader use of renewables. The country has drilled several dozen trial wells, and in March, state-owned PetroChina signed its first production agreement with Shell. China has also invited other global energy players to bring in their technology and expertise.

But no one’s sure the investment will pay off.

“There is no guarantee that the technology will be suitable for China,” says Tao Wang, a scholar at Beijing’s Carnegie-Tsinghua Center for Global Policy. Much of China’s shale may be difficult to fracture. It also tends to be under rugged and remote terrain. So Tao says the Chinese are tempering their hopes for fracking.

Then there are the perhaps more formidable challenges.

Perhaps the biggest is that fracking requires huge amounts of water. That’s a big concern in a place like China, where the country’s age-old problem of water shortages is written into traditional songs like “The Yellow River is Dry.”

Energy analyst Bill Dodson says China’s water problems are only getting worse, and fracking would have to compete for the ever-scarcer supplies with industry, agriculture, and growing cities.

But others say that’s not a deal-breaker.

Ming Sung, a former chemical engineer for Shell who’s now with the Clean Air Task Force, says he’s cautiously optimistic about the environmental benefits of fracking, in part because there are now technologies that allow fracking operations to recycle the water they use. Researchers are also exploring chemical alternatives to water.

Read more and listen to audio story: http://www.theworld.org/2012/08/the-next-fracking-frontier-china/

Paddle for the Peace Puts Site C Dam in Focus This Weekend

July 13, 2012Hydropower, WATERSite C Dam, Water and EnergyCommon Sense Canadian

Read this story from Fort St. John’s Alaska Highway News on this year’s “Paddle for the Peace”, in which hundreds are expected to take part in opposition to the proposed Site C Dam. (July 12, 2012)

Hundreds will canoe down the Peace River on Saturday.

Some are coming to show their opposition to Site C, such as David Suzuki, while others simply want to enjoy the natural serenity of the river.

“Originally it was started seven years ago because we just wanted to bring the community to the river,” said organizer Danielle Yeoman. “We thought it was a good way to bring people…(to canoe) on the river.

“The river is for everyone,” she said.

The event is organized by the Peace Valley Environmental Association (PVEA) and the West Moberly First Nations.

“The PVEA’s sole purpose is to stop Site C; that’s why the organization was created,” said Yeoman. “However, it (was) on the back burners, and so truly, when we started this, it wasn’t to do what we’re doing now.

“Now we are actively, obviously, trying to stop Site C again,” she said.

Site C is a controversial project that would see BC Hydro build a third dam on the Peace River to produce power to accommodate future energy needs for this growing province, according to BC Hydro.

Yeoman said that though the PVEA’s intent is to stop Site C, the event is truly about celebrating the river.

“Everyone is welcome,” she said. “In fact, we’d like people that are pro-Site C to come because it usually takes tow minutes to convert them if they’re sitting on the fence.”

She noted that Suzuki “supports” their cause.

“Everybody just thinks he’s a tree hugger – well, he’s that too – but he’s wise,” she said. “He’s only kept a handful of things he wants to fight and Site C is one of them.”

Yeoman noted that Suzuki has been up here on the Peace in the past, and she’s excited for him to speak.

“One of the things that’s really important, since Site C resurfaced three or four years ago, we didn’t have anybody on our side,” she said.

She noted that having people like Suzuki, The Wilderness Committee and others join PVEA’s cause has been positive.

“They’re coming up and they’re actively fighting Site C too,” she said.

She noted that the event has grown steadily since it began seven years ago.

From Moran Dam to Enbridge: The Danger of Focusing on Economics Over Environment

July 7, 2012Energy and Resources, Oil&Gas, Pipelines and Supertankers, WATERBC Oil Pipelines and Supertankers, Enbridge, Oil and gas, rafe mair, Salmon, Water and EnergyRafe Mair

Robyn Allan is the former President and CEO of the Insurance Corporation of BC and is an economist by trade. I have enormous respect for Ms. Allan and concur with her conclusion, stated frequently and as recently as July 6 in The Vancouver Sun, that the proposed Enbridge Pipeline will have a deleterious impact on the Canadian economy generally and that of BC in particular.

The economics of this huge issue are, of course, very important to the decision making process and to the decision itself. My caveat is, however, to dwell on the economy brings with it great risks.

The argument is the same one respecting dams and fish. If one were to debate a dam on the Fraser River near Lytton, the economic argument is all in favour of the dam. While the salmon runs to be ruined will cost the province and those who fish a lot of money, that is offset by the enormous financial gains from the dam itself many, many times over. In fact such a dam, called the Moran, has been on the drawing board since late in the 2nd World War when it was pushed by the federal government. Premier WAC Bennett raised this issue again in the 1960s and was only stopped by the outcry of those who put the heritage of our salmon ahead of the incredible profits that would come from a huge dam.

Here are the stats according to Wikipedia:

The dam would have been 261 metres (856 ft) high, generating as much power on average as Grand Coulee Dam and twice of Hoover Dam combined – much of this energy would have been sold to the north-western United States. It would form a gigantic reservoir 260 kilometres (160 mi) long, containing some 35.4 cubic kilometres (28,700,000 acre·ft) of water at maximum pool reaching almost to the town of Quesnel. A significant portion of this capacity would be reserved for flood control.

The argument that our Pacific salmon are worth more than money prevailed then – would it prevail today if the issue was revived, which I’m certain will happen?

With the proposed Enbridge Pipeline, the financial benefits are not worth the candle, as Ms. Allan so clearly and accurately says. The trouble is that the governments won’t pay the slightest attention to her or to The Common Sense Canadian’s economist, Erik Andersen. There will be a barrage of one-liners about progress, jobs, blah blah blah, so that economic truths will be trumped by public relations.

The environmental implications of the proposed pipeline are serious beyond belief. We’re talking 1,100 km, over 1000 rivers and streams. My point to Robyn is that before we get to economics, let’s see what this pipeline will do.

Enbridge has an appalling environmental record – about one rupture or spill per week. There is no question that if the pipeline goes through there will be multiple spills. And as Ms. Allan astutely points out, due to the shell corporation structure Enbridge has set up to own and operate the pipeline, their liability for a spill will be severely limited (by design, of course), leaving British Columbians holding the bag for cleanup costs.

The substance being transported is not crude oil as we understand it, but bitumen, a near solid, which unlike other oils, sinks like a stone, and is infinitely more toxic. Enbridge has shown in the Kalamazoo River case that it simply cannot completely clean up, even when it can easily bring workers and machinery into the area.

The Northern Gateway pipeline goes through some of the least accessible places it the world, where the only way to get in is by helicopter. There is no way in the world that workers and equipment could be brought to the site and even if they could, the damage from the spill could never be properly cleaned up.

It’s interesting to note that Enbridge and its supporters sneer at the possibility that they would have to file plans for crossing 1000 rivers and streams – this, they say, is absurd.

I ask why is it absurd? The common environmental requirement for pipelines is that they must file plans for crossing watercourses – why should that not be the case just because there are a lot of watercourses?

In conclusion, I thoroughly agree with Robyn Allan but simply say we shouldn’t let ourselves get to the spot where the economics are considered.